Australia & New Zealand Economics Weekly Storm clouds gather over the economic outlook New Zealand’s retail sales fell for a third consecutive quarter in Q2, as households continued to tighten their belts. What’s more, the sharp drop in heavy traffic volumes in July suggests that goods... 25th August 2023 · 6 mins read
Australia & New Zealand Economics Weekly New Zealand’s economy remains in a rut Earlier this week, the RBNZ signalled that rates would need to remain at their current restrictive level until early-2025. However, we think the Bank will shift gears well before then, given the... 18th August 2023 · 3 mins read
Australia & New Zealand Economics Weekly Australian households pinch pennies New data from the Australian Bureau of Statistics revealed that real household spending well and truly fell of a cliff in Q2. Moreover, with consumer sentiment in the doldrums, private consumption is... 11th August 2023 · 7 mins read
Australia & New Zealand Economics Weekly RBA unlikely to lift rates any higher With the Reserve Bank of Australia having left its cash rate unchanged for two consecutive meetings, we think its tightening cycle is at an end. Indeed, the RBA appears increasingly concerned that... 4th August 2023 · 4 mins read
Australia & New Zealand Economics Weekly Australia confronts its rental crisis Although Q2 CPI data for Australia were softer than most had expected, rental inflation continued to accelerate. Moreover, leading indicators suggest that rental inflation likely won't peak before... 28th July 2023 · 8 mins read
Australia & New Zealand Economics Weekly New Zealand inflation will remain higher for longer The fall in New Zealand’s headline inflation rate in Q2 largely reflected base effects, with underlying price pressures remaining strong. Accordingly, we think inflation will return to the RBNZ’s... 21st July 2023 · 6 mins read
Australia & New Zealand Economics Weekly RBA will only deliver two more rate hikes Inflation seems to be overshooting the RBA’s forecasts and the recent acceleration in pay hikes in enterprise bargaining agreements will add to the Bank’s concerns that inflation expectations may... 14th July 2023 · 6 mins read
Australia & New Zealand Economics Weekly Pay hikes in collective bargaining agreements soar Notwithstanding the RBA's decision to leave rates on hold on Tuesday, we still expect the Bank to deliver three more 25bp rate hikes before bringing its tightening cycle to an end. Indeed, the case... 7th July 2023 · 5 mins read
Australia & New Zealand Economics Weekly RBA has more work to do as economy is holding up Although CPI data released this week showed a sharp slowdown in headline inflation, it’s clear that underlying price pressures remain strong. What’s more, yesterday’s retail sales data revealed an... 30th June 2023 · 6 mins read
Australia & New Zealand Economics Weekly Job mobility eases, critical minerals policy disappoints The latest Labour Force Survey data show that labour mobility in Australia is coming off the boil. That should help contain wage pressures going forward, given that job switching typically results in... 23rd June 2023 · 6 mins read
Australia & New Zealand Economics Weekly No relief for Australian mortgagors All signs are that the Australian Prudential Regulation Authority is unlikely to revise its guidance for the minimum serviceability buffer banks must apply when assessing home loan applicants. As a... 16th June 2023 · 4 mins read
Australia & New Zealand Economics Weekly Australian economy braces for more pain The RBA's hawkish turn has led us to revise up our forecast for the peak cash rate to 4.85%, from 4.35% previously. The resulting rise in mortgage rates means that housing affordability will soon... 9th June 2023 · 6 mins read
Australia & New Zealand Economics Weekly Housing sector creates headaches for the RBA Although house prices in Australia made further gains in May, we don't think that's a sign that the broader economy will remain resilient in the face of monetary tightening. Indeed, residential... 1st June 2023 · 8 mins read
Australia & New Zealand Economics Weekly Electricity will become a drag on inflation next year Electricity inflation will become the highest since the 1980s this year, but with generation costs having plunged, we’ve pencilled in a big drop next year. Those movements probably won’t affect... 26th May 2023 · 6 mins read
Australia & New Zealand Economics Weekly Australia’s productivity problem persists The latest data suggest that Australia’s productivity will continue to languish in the near term. The resulting surge in unit labour cost growth will keep services inflation stubbornly high... 19th May 2023 · 6 mins read
Australia & New Zealand Economics Weekly New Zealand to maintain budget discipline We’re inclined to take Prime Minister Hipkins at his word that the New Zealand government will hand down a fiscally responsible budget next week. We expect government priorities, including cost-of... 12th May 2023 · 6 mins read
